ECOTECH

EcoTech [details] – is a program that is designed to be the ‘talking points’ and/or the message and philosophy behind the effort to help our wholesale distributors attract customers to recovery programs.  However the program could be extended to either help identify the ideal customer or to help Polar integrate with a wholesale account trying to attract more customers or with environmental efforts that are efficiently applying budget money to attract more recovery.  This person can even be defined by his alter ego – we commonly refer to him as “Buba Tech”. 

By more accurately developing the identity of this “ideal customer” a more acute focus can be applied increasing success of any marketing effort and helping to enhance support for this type of  customer.  The intent of this program is not to exclude people that don’t fall into the ecotec profile, but instead help to develop a pipeline that streamlines access to this group and develop rewards that compensate them for the extra effort they invest in being one of the ‘top guns’ of the industry.

This branding or identity development is akin to using the 80/20 principle to insure better effectiveness when investing or applying resources.  So when these two principles are combined together we begin to more clearly narrow the audience so we can refine investment and develop programs and messages that are effective.  If we assume that 20% of the customers shopping at a branch do 80% of the buying, then it is this group that we want to attract.  If we then assume that this 20% of the customers [to be known as the audience] is part of the target group, this would represent a magnitude of 3 [300%] growth rate in recovery volumes.

This growth rate is derived from information developed at Polar and affirmed by other anecdotal sources, showing between 3-6% of the total amount of refrigerant originates with used refrigerant, recycled by certified US reclaimers.  Therefore if we apply the 80/20 principle then we can with confidence estimate that with good training, solid communication and proper tools that our yields without added legislation can grow to 20% market penetration.  We can then equally extrapolate that as the recovered yield increases to 20% it also will decrease the demand because we can then assume a measureable decrease in demand since many of the practices applied to supporting better recovery can also be applied to enhance and train for supporting the logic for retrofit, thereby reducing the demand for HCFCs and ultimately as R-22 reduces in demand the increased share of the recovery will represent an even larger share of total consumption.

Definition: The ideal customer, the "good guy", the embodiment of desirable characteristics:

• Responsible
• Well trained
• Pays his bills on time
• Loyal customer
• Belongs to Dealer programs
• If we continue to carry this out these people are likely responsible in every aspect of their lives, good citizens, good people and always striving to do the right thing.

Purpose: By better understanding the profile for this audience group, we can then develop reward, incentive and awareness programs to encourage and support more recovery and help support these folks.  Positive awareness programs are one facet of a larger matrix of programs that will lead to higher recovery rates.  The type of folks that by definition we are attempting to better understand, we could give them a venue to funnel their skills to become leaders throughout the industry.  By better understanding this demographic and shedding positive light on a group of industry leaders awareness will be brought to an issue that needs attention.

Goal: To increase the amount of recovered refrigerant so that it displaces as much demand for virgin refrigerant production as possible. 

Program Abstract:  It has been assumed that the law is enough to encourage the efficient and maximum recovery.  It has been assumed that because there was a law, people would accept and do the right thing.  But just like a speed limit, people traditionally use the speed limit as a benchmark, some go the proper speed, some less, and some speed.  Assuming there is normal law enforcement the police maintain some order and hand out speeding tickets.  In our case however , EPA does not have the budget or the mandate to support this type of police action as it regards refrigerant recovery. 

It has been public Knowledge for 14 years that after 2010 there would be reduced availability for R-22, however to this day it is still far easier to purchase an R-22 condensing unit.  This is an alarming factor when you consider the replacement rate for condensing units.  Like all equipment, including cars, roofs, washers, dryers, there is also a projected replacement time or as it is commonly referred a ‘life cycle’ for condensing units.  Over time, the life cycle for condensing units has been projected to be 12 years, some as long as 14 years and some as short as 7 years.  Based on that projection the industry builds equipment, as it intends to make equipment available for system owners to purchase.   Therefore if new R-22 units are being sold in 2009, and we project an average life cycle of 14 years, these units will still be demanding R-22, two [2] years after R-22 production has ceased and 12 years after R-22 equipment has been banned from production.  So therefore it could seem irresponsible for a contractor to sell or advise for sale these machines, as they will likely run into supply challenges in supporting these machines.

The problem is, that several challenges exist for the contractor:

1. The equipment they need to bid, is based on the support they get at the branch
2. All contractors provide bids that will be evaluated in a competitive environment, meaning  if they try and sell an R-410 or other comparable recovery unit at a higher price, other competing bidders will provide less expensive equipment options that use R-22
3. It is still cheaper to recharge a system with more expensive R-22 than to go ahead and replace the entire unit and although the variable cost to maintain the system when you include energy and replacement gas as well as maintenance labor is much higher to remain with the old, few have the capital necessary to invest in a new system.  As well it is sometimes in the contractors best interest to continue to maintain an old system than to install a lower maintenance, energy star efficient system.

The problem is that the industry is wedged between a legislative act called the Montreal Protocol that has no Teeth and an industry that is guided by the lowest common denominator.  There is little or no reward for the tech or the salesman or the contracting company to try and up sell or properly sell since that could result in lost sales. 

So we have a group of contractors that are trying to do the right thing, to date there is very little positive reinforcement to reward them for the best effort,   We have an industry that is lagging behind in end of life cycle equipment replacement and we have an opportunity to grow recovery rates from their very low impact level.  Because the demand is so strong and equipment sales for R-22 continue at a very high rate, the price for R-22 is very high.  A high price creates a strong opportunity to develop a profitable and well accepted program since it will be geared to the very audience that would benefit from support in a value added supply chain.

Ecotechnicians have been working in an industry that rewards the Buba Tech’s and we intend to develop programs and tools that reverse this tide and give these ecotechs our attention and support.